Are energy standards promoting gas over electricity?

02 September 2019

Portrait of Dr Sivapriya Mothilal Bhagavathy

by Dr Sivapriya Mothilal Bhagavathy
Postdoctoral Research Associate

Sivapriya (Priya) joined Oxford's Energy and Power Group as post-doctoral research associate in March 2018.Her areas of expertise include distributed generation and its grid integration, whole system perspective of energy analysis and power system modelling.

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Decarbonising our energy systems is a global challenge which requires a greater adoption of renewable energy sources. In the context of the global need to achieve Net Zero emissions, and the UK declaring no gas boilers in new homes from 2025, there is a need to move to low carbon sources for power and heat, which includes greater use of electric- space and water- heating systems.

Using buildings as storage systems

The intermittent nature of renewable energy sources underscores the need for storage to balance the mismatch between demand and generation. We can use the thermal inertia of buildings, with electric- space and water- heating systems, as a low-cost storage service for the electricity network. There have been great advances in these heating systems in recent months however policy and standards have not kept up.

Why does this matter?

If the bias of the energy label results in continued use of instantaneous gas boilers and no significant switch to electric hot water tanks, we can lock ourselves into domestic gas consumption for decades, hampering our efforts to reduce carbon emissions.

Outdated assumptions

Energy labels on products (star rating or alpha-numeric numbering) and buildings (e.g. Energy Performance Certificate (EPC) rating) give important information that enable people to make decisions. It is generally considered that a product with a higher rating has a higher efficiency. However, when we compare hot water tanks, the European energy label gives a higher rating to gas-heated tanks than to electrically-heated tanks, which is wrong.

This label, which is governed by the European Energy Labelling Standard EU 812/2013, biases gas over electricity due to outdated assumptions and an inconsistent boundary defining the input and output stages of the products. These are also true of the standard EU2015/1188 which governs the energy label for space heating products, and the EPC which provides an indication of a building’s overall energy performance.

These standards apply a Conversion Coefficient to electrically heated systems, to account for the generation efficiency of electric power production. An averaged conversion efficiency of 40% across the EU’s entire electricity generation fleet is used, irrespective of the geographic location of the systems. The standards do not apply a Conversion Coefficient to gas powered systems however, which implicitly assumes that there are no losses associated with the generation and distribution of gas. This is incorrect.

Historically, electrical power networks were built around large centralised thermal plant powered by fossil fuels such as coal and gas. Typically, these facilities achieved an efficiency of around 45%, with transmission and distribution networks incurring additional losses of 10%, resulting in an overall efficiency of 40% to the end-user. Recent advances however have led to an increasing prevalence of distributed renewables; generation is closer to the point of consumption eliminating the losses associated with transmission, and reducing carbon emissions further.

This raises the following questions which are discussed further in our research:

  • Is this policy measure justifiable on the grounds of carbon emissions?
  • Why is there no conversion coefficient applied to gas-fuelled hot water systems?
  • Why is the notion of a power source conversion coefficient not applied to other appliances?
  • Is it right for a product standard to determine energy policy across the whole of the European Union?
  • Is a policy that mitigates against electric hot water storage sensible from the perspective of an energy system encountering a higher share of renewables
Call for change!

We argue for the removal of the conversion coefficient from standard EU 812/2013, EU2015/1188 and the EPC. This would level the playing field between electric hot water tanks and instantaneous gas boilers.

We call for organisations that set and review standards to become more proactive and review them very regularly in recognition of the advances in our energy systems and the need to minimise greenhouse gas emissions associated with dwellings and heating systems.

Further reading:

This opinion piece reflects the views of the author, and does not necessarily reflect the position of the Oxford Martin School or the University of Oxford. Any errors or omissions are those of the author.